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Warnie

15,402 Posts.

314

27/11/16

10:01

Post #: 20915084
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Originally posted by Warnie ↑

You are about to double up on a stock where you've already lost 50%?
You are going to double down just to bring your total average down?
These are not sound strategies IMO.

You've already proven the stock is a dud, why sink more money into it?

You didn't listen to the above tips and put in a stop loss at say 3-5% below your originally buy in price. I you had done so you would be down 3-5% not 50%.

The answer probably is, don't buy more, sell what you have, and let it be a good lesson for you.

As for determining the average, buy 100 at 1.4c, then buy 100 at .7c, your average is now 2.1c / 2 = 1.05c.

Might sound nice and look better on paper, but now you have twice the amount invested in a dead stock, well so it seems.

Why did you buy at 1.4c?

Let me guess, you followed the hype and bought at the top?
Another lesson to be learnt here, don't buy last, buy first and sell first.

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Seems you are following cheap lithium stocks, let me tell you this, 99.9% of lithium stock will never produce lithium and even less will ever make any money.

If you must buy in that space, Id be looking for stocks with short term development and production timelines with a lot of cash on hand.
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